For people living in Europe, or Japan or the US the past few years have been associated with serious bank crises. Think of the Lehman Brothers, Bank of Cyprus or the Kaupthing bank of Iceland ban... But actually there is a country very close to us which has managed to navigate brilliantly through all this turmoil: Canada. 4 of the 5 major Canadian banks reported a profit for 2008, and all of them reported a profit in 2009, needless to say that none of them asked the Canadian government for an emergency loan which was the rule in the US and Europe at the time. Actually it is not the first thing that the Canadian bank system outperformed the others. During the Great Depression of 1930s, 9000 banks went bankrupt in the US but not a single one made default Canada. It is a fact that the Canadian banking system is extremely stable, which is due to the way lending is done in Canade. First, the Canadian banks have a strong track record of being careful lenders: they only do lend to people who can demonstrate a capacity to repay their loans and especially with regards to mortgages. Canadian banks require that the borrower makes a down payment of typically 20% during a house purchase, and they will be very strict with amortization periods. Second the mortgages are government-backed, meaning that if borrowers cannot repay their loans, the government will step in to make the payments which makes a huge difference for the banks in terms of credit risk. Last but not least Canadian banks are authorized by the government to take big margins on all the products and services to their customers. Similar fee practices would be criticized by most governments but they are encouraged by the both Canadian government and finance regulatory body. And you bet that the Canadian banks use this opportunity to increase their revenues in terms of crisis and build up their treasury. All this regulated by the Canadian Bank Act which is a very good regulation: both strict and pragmatic for the business. The conclusion we draw from this is very clear: Canadian banks, are low-risk money machines with good returns to investors. They are exactly what bank should be. How to buy shares from Canadian banks? First, the stocks of the five major Canadian banks are traded in the New-York Stock Exchange:

Bank of Nova Scotia (NYSE:BNS)

Royal Bank of Canada (NYSE:RBC)

Toronto-Dominion Bank (NYSE:TD)

Bank of Montreal (NYSE:BMO)

Canadian Imperial Bank of Commerce (NYSE:CM)

Or if you have a limited capital to invest we recommend that you subscribe to the Exchange Traded Fund from Blackrock: iShares S&P/TSX Capped Financial Index Fund traded on the Toronto Stock Exchange (ticker TSX:XFN):

To find a broker to invest in Canada follow the link HERE.To learn more about exchange-traded-funds follow the link HERE.